quizes 1-8 web

8/2/2019 Quizes 1-8 Web

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A globalcompany is anorganizationwithmulticountryaffiliates, eachof which

formulates itsown businessstrategy basedon perceivedmarketdifferences.

A) True

B) False

Feedback:Page: 10Difficulty: Easy

2

2 CORRECTOne variable commonly used to measure where and how fastinternationalization takes place is the increase in total foreign directinvestment.

A) True

B) False

Feedback:Page: 17Difficulty: Hard

3 2

3INCORRECT The forces in the foreign environment operate the same way as those in

the domestic environment except that they occur in foreign nations.

A) True

B) False

Feedback:Page: 24Difficulty: Medium

4

4INCORRECT An international manager has two choices on what to do with a concept or

technique employed in domestic operations: (1) transfer it intact or (2)adapt it to local conditions.

A) True

B) False

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5 2

5INCORRECT Financial, economic, and distributive forces are examples of controllable

forces influencing the life and development of a firm.

A) True

B) False


6 4

6INCORRECT All the following are true about a global company except that it:

A) maintains a presence in key markets around the world.

B) looks for differences among markets.

C) integrates its operations worldwide.

D)

standardizes operations worldwide in one or more of the firm'sfunctional areas.


7 4

7INCORRECT The major globalization drivers include all of the following except:

A) political.

B) social.

C) technological.

D) market.

Feedback:Page 13Difficulty: Medium

8 4

8 CORRECTDue to the expanding importance of foreign-owned firms in localeconomies, host governments have made their policies toward thesecompanies _____.

more strict

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A)

B) more liberal

C) less powerless

D) more confronting


9 4

9 CORRECTManagement has no direct control over the external environment of thefirm but can exert influence by:

A) heavy promotion of new products to change cultural attitudes.

B) focusing on the strategic plan.

C) increasing the number of people.

D) exerting control over the inventory.


10 4

10INCORRECT Unconscious reference to one's own cultural values when judging

behavioral actions of others in a new and different cultural environment iscalled:

A) self-reference culture.

B) self-reference values.

C) self-reference criterion.

D) self-reference environment.


Quiz 2

The extensivedistribution system isone reason Japan sells

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more to developingnations than mostdeveloped nations do.

A) True

B) False


2 2

2INCORRECT The distinction between portfolio investment and direct investment

has begun to increase in recent years due to the growing number of international mergers, acquisitions, and alliances.

A) True

B) False


3 2

3 CORRECTEngaging in foreign trade is typically less costly and less risky thanmaking a direct investment into foreign markets.

A) True

B) False

Feedback:Page: 48

Difficulty: Medium

4 2

4INCORRECT Simultaneously introducing products in foreign markets and in the

domestic markets reduces sales volume while also increasing the costof goods sold.

A) True

B) False


5 2

5INCORRECT Export processing zones and in-bond plants are bound by taxation and

regulation of materials brought into the zones for processing andsubsequent re-export.

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A) True

B) False


6 4

6

INCORRECT The annual outflows of foreign direct investment means:

A) level of state-owned investment funds.

B)

value of the total outstanding stock of all foreign directinvestment.

C) the amount invested each year into other nations.

D) bamboo network in the level of worldwide FDI.


7 4

7INCORRECT In using GDP per capita as a basis for making comparisons of nations'

economies, all of the following statements hold true except:

A)

extreme care must be exercised to avoid drawing unwarrantedconclusions.

B)

the statistical systems in many developing countries are deficient.

C) the reliability of the data provided is often questionable.

D)

GDP per capita is an arithmetic mean obtained by dividing GDP bythe total income.


8 4

8

INCORRECT Preferential trading arrangement is:

A) an agreement by a small group of nations to establish free tradeamong themselves while maintaining trade restrictions with allother nations.

B)

an agreement by a small group of nations to establish free trade

with all other nations while maintaining trade restrictions amongthemselves.

C)

an agreement by a small group of nations to study the directionof trade and analyze major trading partners.

an agreement that allows government designated zones to maketheir initial market entry with local manufacturing facilities.

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D)


9 4

9INCORRECT In-bond plants (maquiladoras):

A)

are government designated zones where parts and processedmaterials can be imported without import duties.

B)

requires import duty to be paid only on the value added on thefinished product.

C) do not require the imported items to be re-exported.

D) are located on the border between Mexico and the U.S.


10 4

10

INCORRECT Increasing wage rates in Mexico have affected maquiladoras in whichof the following ways?

A)

They have encouraged Mexican firms to establish U. S. plants tosupply the Mexican market.

B)

They have encouraged higher value added work in the Mexicanmaquiladoras plants.

C)

They have encouraged high labor intensive work in the Mexicanmaquiladoras plants.

D)

They have encouraged low skill production in the Mexicanmaquiladoras plants.


The Heckscher-Ohlintheory states that

differences in productioncosts occur because of differences in the supplyof production factors.

A) True

B) False

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2 2

2 CORRECTAn important outcome of Leontief's work was recognizing the potential

for differences in the kinds of labor as well as differences in naturaland capital resources.

A) True

B) False


3 2

3INCORRECT Recent research on the first mover theory also confirms that firms

moving first into a market soon dominate it.

A) True

B) False

Feedback:

Page: 82Difficulty: Medium

4 2

4

INCORRECT Internalization theory suggests that to obtain a higher return on itsinvestment, a firm should transfer its superior knowledge in the open

market rather than selling it to a foreign subsidiary.

A) True

B) False


5 2

5 CORRECTThe eclectic theory of international production is sometimes referredto as the OLI model.

A) True

B) False


6 4

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6INCORRECT Adam Smith claimed that:

A)

government, not market forces, should determine the direction,volume, and composition of international trade.

B)

a nation could trade advantageously if it had a comparativeadvantage.

C)

market forces, not government controls, should determine thedirection, volume, and composition of international trade.

D) customers' tastes are affected by income levels.


7 4

7

INCORRECT Which of the following is not true about the international product lifecycle?

A) Concerns the role of innovation in trade patterns.

B)

Can be applied to new product introduction by firms in any of theindustrialized nations.

C)

Views a product as going through a full life cycle from thestandardization stage to internationalization.

D)

The initial innovation stage of the cycle borrows from the Lindertheory.


8 4

8

INCORRECT Economies of scale and the experience curve effect are important forinternational trade because:

A)

most manufacturing, mining, and transportation industries aresubject to economies of scale.

B)

they allow a nation's industries to become low-cost producerswithout requiring that the nation have an abundance of a certainclass of production factors.

C)

they justify efforts at being a first-mover in order to become aninternational leader.

D)

they do not allow the spread of very high fixed costs over sales

within foreign and home markets.Feedback:Page: 81Difficulty: Hard

9 4

9

INCORRECT To sum up international trade theory, we can say that the primaryreason for trade is:

similarities in endowments of the factors of production.

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A)

B) differences in interest rates for investments.

C) the existence of price differentials among nations.

D) effective utilization of factor intensities.


10 4

10INCORRECT Dunning's Eclectic Theory of International Production states that if a

firm is going to invest in production facilities abroad, it must have thefollowing kinds of advantages:

A) ownership-specific, location-specific, and internationalization.

B) strategic, location-specific, and technological.

C) ownership-specific, location-specific, and internalization.

D) technological, financial, and ownership-specific.

The UnitedNationsinstitutionaddresses issuesthat requireglobal or regionalsolutions.

A) True

B) False


2 2

2INCORRECT The GATT and the WTO work in tandem to support trade liberalization.

A) True

B) False

Feedback:Pages: 106-107Difficulty: Hard

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3 2

3INCORRECT The OECD, the "rich man's club," was formed to keep trade within the

developed nation markets.

A) True

B) False

Feedback:

Page: 112Difficulty: Easy

4 2

4INCORRECT The North American Free Trade Agreement integrates the nations of

North America to ensure free trade and free movement of labor.

A) True

B) False


5 2

5 CORRECTOn EU matters, the European Court of Justice has authority thatsupersedes that of the member-nations' national courts.

A) True

B)

False


6 4

6 CORRECTThe IMF has had many successes. Which of the following point to one of the current IMF challenges?

A) Develop a way for global financial markets to spread risks.

B)

Develop and maintain a system of currency exchange that makesglobal trade possible.

C)

Support governments in their noninflationary monetarymanagement.

D) Help the world trading system avoid financial disasters.

Feedback:Pages: 102-103Difficulty: Hard

7 4

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7INCORRECT All of the following are fundamental principles of ASEAN except:

A) noninterference by members in the internal affairs of one another.

B)

renunciation of the threat or use of force.

C)

enlargement of the organization's activities to include apeacekeeping force.

D) effective cooperation among members.


8 4

8

INCORRECT OAS focuses on:

A) opening government procurements to transnational bids.

B)

including protectionist barriers in all sectors that protect domesticproducts.

C)

fostering democracy, protecting human rights, strengtheningsecurity, and fighting corruption.

D)

serving as a regional vehicle for promoting open trade and practicaleconomic cooperation.


9 4

9INCORRECT Which of the following is not included in the membership criteria for the

European Union?

A) Adherence to principles of liberty.

B) The country must show evidence of respect for democracy.

C)

The country must show respect for human rights and fundamentalfreedoms.

D) The country must have a rising GDP.


10 4

10

INCORRECT What is the role of the Council of the European Union?

A) Pass European laws.

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B) Administer the daily operations of the EU.

C)

Act as a policy-setting institution of the EU and the voice of themember-states.

D)

Focus on financial and social issues.


The nationalculture is a keydeterminant forthe evaluation of managers.

A) True

B) False


2 2

2INCORRECT Legal characteristics and political structures are components of culture.

A) True

B) False

Feedback:

Page: 142Difficulty: Easy

3 2

3INCORRECT The demonstration effect is a result of the backward-bending labor

supply curve.

A) True

B) False

Feedback:Page: 145

Difficulty: Medium4 2

4INCORRECT Generally, the greater the difference between an old and a new method

or product, the easier it is for the firm to gain acceptance of a change.

A) True

False

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B)


5 2

5 CORRECT According to Hofstede, power distance is the extent to which membersof a society accept the unequal distribution of power among individuals.

A) True

B) False


6 4

6

INCORRECTThe first step international business managers can take in order to learnto live with other cultures is to:

A) learn the language.

B) visit the country.

C) realize that other cultures exist which are different from their own.

D) make friends with natives of the country.

Feedback:Page: 139

Difficulty: Easy7 4

7INCORRECT All of the following indicate the importance of technological superiority

to international companies except:

A) it can be embodied in the company's products.

B)

it gives a firm confidence to enter a foreign market even when othercompanies are already established there.

C)

it enables the firm to obtain better-than-usual conditions for aforeign market investment.

D) it keeps the international division of labor constant.

Feedback:Pages: 150-151Difficulty: Medium

8 4

8 CORRECTStrategic technology leveraging is:

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A)

using external technology to complement rather than substitute forinternal technology.

B)

obtaining more efficiency from technology by increasing capitalinvestment.

C)

using technology to improve a firm's strategy.

D)

forming blocs to prevent the poaching of technological ideas andinnovations.


9 4

9INCORRECT Social units based on free associations may be formed by all of the

following except:

A) Age.

B) Family.

C) Common interest.

D) Gender.


10 4

10 CORRECT

____ is the degree to which the members of a society feel threatened byambiguity and are rule-oriented.

A) Uncertainty avoidance

B) Power distance

C) Individualism

D) Short-term orientation

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